Govt, House agree to raise ICP reference to $80 per barrel

The government and the House of Representatives (DPR) agreed on Monday to increase Indonesia crude price (ICP) reference in the 2010 state budget to US$80 per barrel from $65 per barrel in line with the increase in the crude oil prices in the world market.

Energy and Mineral Resources Minister Darwin Zahedy Saleh said in Jakarta on Monday that DPR also agreed to maintain the level of the crude oil production at 965,000 barrels per day (bpd) despite the proposals from some legislators to reduce the production to 955,000 bpd.

?I think DPR?s proposal to increase the crude oil price assumption to $80 per barrel is quite relevant,? he said. The ministry earlier proposed to increase the price reference to $77 per barrel.

Meanwhile Evita H. Legowo, the director general of oil and gas at the ministry, said that the crude oil production target was fixed after her office received commitment from oil and gas producers that the target was achievable.

?The new crude oil production target of 965,000 bpd had been confirmed to (oil and gas regulatory body) BPMIGAS and oil and gas production sharing contractors," she added.

Earlier, the government proposed to cut oil production target in the state budget to 955,000 bpd from 965,000 bpd due the low production trend during the first four months of this year. (godang)